Home owners will have access to affordable flood insurance for the next five years now that President Obama has signed a five-year reauthorization of the National Flood Insurance Program.
Congress passed the Biggert-Waters Flood Insurance Reform Act of 2012 late last week as part of a transportation funding bill and the President signed it Friday. The legislation extends NFIP authority through September 30, 2017.
NFIP protects more than 5.6 million properties in about 21,000 communities where flood insurance is required for mortgages. Private market insurance companies offer flood insurance on high-value homes, but not policies for the lower-priced homes.
Flood-related disasters claim more lives and damage more property than any other type of natural disaster because they happen anywhere rain or snow falls — including every state in the U.S.
Federal flood insurance reduces the amount of money the federal government has to spend on disaster relief for flood victims.
Since September 2008 there have been more than 17 short-term NFIP extensions and authority the program has expired two times, delaying or cancelling 1,300 real estate transactions each day of the lapse, according to NAR research.
During the June 2010 lapse, NAR survey data estimates that more than 40,000 home sales were delayed or cancelled, which undermined home buyer and investor confidence.
Reps. Spencer Bachus (R-Ala.), Judy Biggert (R-Ill.), Barney Frank (D-Mass.), and Maxine Waters (D-Calif.); as well as Sens. Tim Johnson (D-S.D.), Richard Shelby (R-Ala.), Jon Tester (D-Mont.), and David Vitter (R-La.) were instrumental in passing the extension, NAR Presdient Moe Veissi said.